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Applied Materials (AMAT) Stock Sinks As Market Gains: What You Should Know

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Applied Materials (AMAT - Free Report) closed the most recent trading day at $109.97, moving -0.21% from the previous trading session. This move lagged the S&P 500's daily gain of 0.4%. Meanwhile, the Dow gained 0.33%, and the Nasdaq, a tech-heavy index, lost 1.1%.

Heading into today, shares of the maker of chipmaking equipment had gained 5.39% over the past month, outpacing the Computer and Technology sector's loss of 0.9% and the S&P 500's loss of 0.01% in that time.

Wall Street will be looking for positivity from Applied Materials as it approaches its next earnings report date. In that report, analysts expect Applied Materials to post earnings of $1.93 per share. This would mark year-over-year growth of 2.12%. Our most recent consensus estimate is calling for quarterly revenue of $6.68 billion, up 6.59% from the year-ago period.

AMAT's full-year Zacks Consensus Estimates are calling for earnings of $6.83 per share and revenue of $24.43 billion. These results would represent year-over-year changes of -11.3% and -5.26%, respectively.

Investors should also note any recent changes to analyst estimates for Applied Materials. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.07% higher. Applied Materials is holding a Zacks Rank of #3 (Hold) right now.

Digging into valuation, Applied Materials currently has a Forward P/E ratio of 16.13. For comparison, its industry has an average Forward P/E of 16.94, which means Applied Materials is trading at a discount to the group.

Investors should also note that AMAT has a PEG ratio of 2.35 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Semiconductor Equipment - Wafer Fabrication was holding an average PEG ratio of 1.92 at yesterday's closing price.

The Semiconductor Equipment - Wafer Fabrication industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 38, which puts it in the top 16% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on

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